By now, everyone has heard the story of how Target uses predictive analytics to better target their customers. So why does Target engage in predictive marketing? Is it worth their time and money?
As an outsider, you can only measure their success through company growth. Understanding how much of that growth is attributable to analytical efforts is known only to those inside the company.
I have seen small changes in ad copy increase conversions by 50%. The fact is that every company has a set of marketing levers they can tweak to improve performance. Target may have the resources to become optimal, but small businesses can make use of powerful yet simple tools and tactics and still achieve higher results.
Below is a consolidation of channels and improvement guidelines where I have seen the most potential for growth.
Update Your Email Marketing
Email marketing commonly becomes a routine to the marketer. Therefore the offers and driving content usually becomes boring and repetitive.
According to this study by Exact Target, the 2nd most important reason people unsubscribe is that the content becomes repetitive.
To avoid falling under this trap, marketers should consider creating various types of offers to each of their customer segments, at different times during the relationship.
A,B,C testing all the offers, imagery and content helps you understand what works and what doesn’t so you can disregard those without much success and continue to use the most popular ones. Small changes in click-through rates can significantly increase sales and conversion rates.
Check Your Frequency
The problem of mass email is twofold. Consumers are bombarded with emails and retailers cannot capture well the consumers’ attention. Opting out of newsletters and offers has become a common practice and it is estimated that 15% of people once on your list will opt out.
According to the study cited above, the top reason is “email came too frequently.” You have data on how often people purchase and what content drives engagement.
A simple segmentation exercise based on last customer interaction, products purchased, and response history can provide insight on the ideal frequency for each customer.
Ad Placement is Key
The websites your ads appear on and page placements are the two main factors of click-through success. It’s been found that ads that appear above the fold and seven times more successful than those delivered below the fold.
Frequency turns out to be very successful. Ads shown 5 or more times to a user are 12 to 14 times more successful than ads shown less than 5 times.
I personally witnessed significant increases in click-through rates as a database marketing consultant. Simple tweaks in messaging and location improved our conversions and lowered costs. Trial and error is key in understanding what drives people to your sight.
Keyword research is more of an art than science (although everything can be measured online.) Search is becoming very specific when people look for a specific product for their needs. Many of these keywords go unnoticed by vendors. These are likely to be cheaper, drive less traffic, but provide higher conversion rates.
There are many analytical tools to measure keyword success so there is no gut feeling. If you clearly see that a keyword drives more that 85% away then one would want to adjust.
By continually adjusting, you will find the right set of keywords and messaging needed to position yourself in a stronger position than your competitors.
Content is Still King
What you put on your email newsletter, offers, website, blog, and even ads is the most important aspect of any campaign. Companies like Target cited above understand this concept very well: “The right content at the right time.”
In the article it said that Target even purposely sent offers about un-targeted products so it didn’t concern the shopper of privacy issues.
The secret to good content is adding value first. A coupon or offer can be helpful when one is in the market for a specific product and the coupon has the right price and ease of purchase.
Other times, marketers need to engage the customers by sending important and useful information. This is where you develop your customer life cycle campaign.
Content and messaging directed at increasing trust and engagement in a brand in pursue of a purchase at a later stage.
Marketing is about execution, trial and error, and value creation. Big ideas come from creative minds and having a high quality product still triumphs, but there are various levers to adjust and improve results. Continually study your online measurements, try new ideas, and be flexible to adjust.
Jaime Brugueras the CEO of Mineful – a customer retention and analysis software. Jaime writes frequently about marketing analysis, customer retention, and email marketing. He has been published in several industry publications including eCommerce Times. Follow Mineful on Twitter for industry insight and conversations.